Insurance Lessons from West, Texas

On Wednesday, April 17, a fire broke out at the West Fertilizer Company in West, Texas, a community of 2,849 about 70 miles south of Dallas.  10 volunteer firemen and two people who joined them responded to the calls that began being fielded by the 911 call center at 7:33.  As first responders, they began to assess the massive fire and plan how to begin putting out the blaze.  They were killed moments later from the explosion that occurred at 7:51 pm.

People heard or felt the blast up to 80 miles away.  The explosion tore through a 3 foot thick concrete slab and and the earth below it leaving a crater 13 feet deep and 93 feet across.  The home nearest to the plant was 300 feet away and it was completely destroyed.  Homes, a middle school, an apartment building and a nursing home were damaged or destroyed within the 37 block blast zone.

The positive and negative force created by the explosion lifted roofs, blew out windows and collapsed walls.  Fires burned into the night as homes in town were ignited by embers carried on gusting winds.  Early morning rain and cooler temperatures helped put the fires out.  In a community of this size, everyone is touched in some way by such a tragic event.

The toll of the damage from the explosion and the fires is extensive.

  • 15 people lost their lives
  • About 200 people were injured
  • About 350 homes surrounded the plant
  • These homes were divided into 3 zones
  • Zone 3 contains 160 homes and was the hardest hit
  • 70 homes were damaged beyond repair and will be torn down
  • 85 homes were declared unsafe to live in but could be salvaged with extensive repairs
  • 3 homes were damaged but livable

Initial estimates by a county official placed the damage at $100 million.  The West Fertilizer plant’s general liability policy only provides coverage of $1 million of coverage.

Residents that lived closest to the plant were allowed to visit their homes 10 days after the blast.  It gave them time to see what if anything could be salvaged from their homes.  Insurance company adjusters and disaster team members are also reviewing what can be repaired and what will need to be rebuilt.  Efforts to start that process are waiting on decisions the West town council members have to work through including:

  • Where will the debris go
  • Restoration of infrastructure – electricity, gas and water
  • Will new certificates of occupancy be required for homes that are salvageable but need major repairs
  • Grandfathering the repairs that have already started
  • How to handle the permitting process for the restoration and replacement projects, some of which has already started

While the residents of West and its town council work through these details, ATF investigators are investigating the fire and the explosion.  Also present are investigators from a score of state and local agencies.  What is known is:

  • The fire started in the building where ammonium nitrate was stored in bins
  • Most investigators are in agreement that ammonium nitrate is probably the chemical that exploded

What’s still unknown is:

  • The cause of the fire
  • How much ammonium nitrate was on hand
  • Were other chemicals present that contributed to the explosion

Investigators are hoping to determine the answers to all the questions by the end of May.

There are 3 key insurance lessons we all can learn from the people of West.

  • Insure your home even after the mortgage is retired
  • Insure your home and your contents to their replacement cost value
  • Know what’s in your home

Not everyone in West had home insurance.  The number of residents who didn’t have insurance has not been released.  Even if you’ve paid off your mortgage and home insurance isn’t required, having coverage means you don’t have to shoulder the cost of repairs or rebuilding alone.  It also alleviates waiting on state or federal aid that may or may not be given and usually comes in the form of loans.

When was the last time you looked at your home policy?  Well that’s been too long and now would be a great time to review it to see what your home is insured for.

  • Take the amount your home is insured for and divide it by the number of square feet your home has.
  • That will give you the amount of coverage you have per square foot.
  • If it’s not at least $90 a square foot, you’re probably under insured.

While you’re reviewing your policy ask your agent if it’s a replacement cost policy.  If it’s not, then see what it would cost to make it one.

Take a digital camera or smart phone and take pictures of what’s in your home.  If you lost everything, as some of the residents of West did, you’ll be asked to provide a list of lost items.  Most of us couldn’t remember every shirt, pair of pants, how many towels, dishes, glasses, etc. we own.  Taking these pictures will help you reconstruct what you owned.  Make sure you’ve stored these pictures in a safe place too!

Do you have a suggestion, comment or question?  Share them with me in the comments section of our blog or on our Google + and Facebook pages.  We’ll all learn something!

Evie Wise
Evie Wise


Evie Wise
Evie Wise

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